Rough Start for PlayBook as RIM Issues Recall

It's only been a few weeks since Canadian tech company Research in Motion (RIM) shipped its PlayBook tablet, a direct rival to Apple's ubiquitous iPad. And while buzz surrounding RIM's device has led to decent sales, a recent report announcing a PlayBook recall is unlikely to spur further momentum in an already tough market.

In a statement issued Monday, Waterloo, Ontario-based RIM admitted that it was issuing a recall for 1,000 PlayBook tablet computers, citing operating system (OS) problems.

The company noted that the issue "may result in the devices unable to properly load software upon initial set-up," meaning that somewhere out there an excited new PlayBook owner has found themselves in possession of a $499-$699 high-tech brick. (Source: longislandpress.com)

Staples Association Remains Unconfirmed

The problem was first reported over the weekend by handheld blog Engadget, which noted that many of the PlayBooks had been sold from Staples stores. Neither RIM nor Staples have commented on this, however.

RIM is encouraging anyone encountering this problem to contact them immediately for a replacement. The company also said that most of the affected devices were still in the shipping process and have since been sent back to RIM.

RIM Stock Dips on Recall

None of this is good news for RIM, which was recently forced to cut back its fiscal first-quarter forecast, admitting that the number of BlackBerry smartphone devices shipping right now is far below expectations.

The PlayBook, which is easily integrated with the BlackBerry, could see to a revival in smartphone sales, but unfortunately Apple is proving a tough competitor in both markets. Google Android devices are also proving a problem, one that will only get more troublesome for RIM once more Android-based tablet PCs begin shipping later this year.

All of these concerns translated into another dip in RIM shares, which dropped 25 cents to $42.99 after the recall's announcement. That marks the lowest price for RIM stock since March 2009. (Source: reuters.com)